Polkadot is a decentralized network that serves as a link between chains. It is an open-source protocol for connecting and protecting private blockchain networks. Polkadot facilitates cross-chain transfers of assets that includes tokens, documents and other assets.
Polkadot aims to provide the foundation for the blockchain’s decentralized Internet, also known as Web3.0.
Polkadot has been developed by Gavin Wood, and its uniqueness resides in it being interoperability, energy efficiency, and customized blockchain development paired with a cross-chain / ‘para chain’ combination.
In other words, Polkadot provides developers a platform to establish their own blockchian and also provides a medium to connect the para chains through its smart contracts.
What are the Uses of Polkadot and Use Cases of Polkadot?
Polkadot (DOT) is a software network whose main purpose is to develop a blockchain on which other blockchain networks can be launched and operated by crypto users and enthusiasts. Here are some uses of Polkadot:
Polkadot protocol connects public and private chains allowing the independent blockchains to share information and transactions.
The uses of Polkadot network lies in its native token, Dot. Polkadot’s native token DOT serves three distinct purposes: ensuring operations and security, facilitating network governance, and binding tokens to connect parachains.
Governance: The Dot holders have full control over the protocol. By Governance in blockchain, it means how a transaction and block can be verified based upon the rules and how the rules can be enforced. Polkadot provides a facility of Governance through its proof of stake consensus. By this function, even the fees of the network is determined. These functions are not formally granted to DOT holders, but rather the underlying code of Polkadot will enable DOT holders to participate in governance.
Staking: Polkadot provides a medium of rewarding the holders by the process of staking. Game theory incentivizes token holders to behave in honest ways. In order to secure its network, Polkadot rewards the good actors while the bad actors will lose a stake in the network. The Polkadot network will rely on the holders solely for executing this function. DOT required to participate in the network will vary according to the activity undertaken, the duration DOT is staked for, and the total number of DOT staked.
Bonding: Bonding is a form of proof of stake. By this new parachains are added to the Polkadot network. The DOT will be locked during their bonding period and will be released back to the account that bonded them.
Use Cases of Polkadot
A couple of exciting projects have been developed using the Polkadot blockchain. Some of them are:
Kusama uses Polkadot codebase and it provides a multichain platform for the developers. Using the Kusama network, a developer can determine the effectiveness of their code and the dApps. Kusama has been established by Gavin Wood who is the founder of Polkadot and was also the CTO of Ethereum.
Darwinia is one of the most innovative projects created on the Polkadot network. Darwinia helps in easy migration from any Ethereum/BSC projects to the platform. Like if any Defi or NFT app developed on Ethereum wants to migrate to the Polkadot network, Darwinia, supports such dApps that facilitate this process.
PolkaFoundry provides the platform for the creation of Defi and NFT dApps on Polkadot network.
How is Polkadot Different from Others?
In order to increase its adoption, every blockchain has some unique features. Here are a few differentiation between Polkadot and other blockchains:
Unlike Ethereum, which is a Layer-2 blockchain, and Polygon which is a Layer-1 protocol, Polkadot (DOT) is the foundation of the Layer 1 blockchain network and is called the Layer 0 metaprotocol because it represents a format called para chain.
Polkadot (DOT) can also autonomously and seamlessly update its code base through on-chain governance at the will of the community of token holders.
The Polkadot network is secured by the nominated Proof-of-Stake (NPoS) consensus mechanism.
Polkadot’s connection makes it possible to share data and value across previously incompatible networks. Furthermore, the network is designed to be scalable and fast to avoid speed issues.
The reduction of parallel processing segments is also one of the aspects of this network. Users can execute numerous transactions at lightning speed thanks to its layer, which is referred to as a para-chain.
Who are the Competitors of Polkadot?
Competitors to Polkadot is based upon its use cases, differences and also reliability of blockcahin and ease of use of blockchain. Some of teh important competitors of Polkadot blockchain are:
- Corda R3
- AVA Labs